The North American Electric Reliability Corp. is overstating the reliability risks faced by the Midcontinent Independent System Operator, according to David Patton, president of Potomac Economics, the grid operator’s market monitor.
In its 2024 Long-Term Reliability Assessment released in December, NERC said MISO was at a high risk of having a shortfall in electricity supplies at the peak of an average summer or winter season in the next five years — the worst ranking of all North American regions.
“I’d love to work with NERC to figure out where they got their numbers from, because I don’t think they’re accurate,” Patton said Thursday during a technical conference on resource adequacy challenges in the United States held by the Federal Energy Regulatory Commission.
NERC understates MISO’s capacity for demand response, behind-the-meter generation and firm capacity imports by more than 8 GW, Patton said in written testimony to FERC. Also, NERC considered possible power plant retirements that have not occurred, according to Patton.
Potomac Economics also acts as the market monitor for the Electric Reliability Council of Texas, ISO New England and the New York Independent System Operator. “MISO is the most reliable of any of them,” Patton said. “If I was concerned about the lights going out somewhere, it would not be MISO.”
In recent winter storms, MISO exported power to neighboring grid operators to help meet their needs, Patton said, noting the exports reflected the value interconnections between grid operators can have.
Further, MISO has been vastly overestimating the power supplies it will need in coming years to meet demand for electricity, Patton said. In its 2024 Regional Resource Assessment, MISO said its footprint may need 17 GW of new resources every year for the next 20 years.
“That’s a result of a clearly flawed planning process,” Patton told FERC. In its modeling, MISO assumed utilities would build almost exclusively intermittent renewable resources, even though their reliability value under MISO’s future marginal accreditation approach will fall to close to zero, according to Patton’s testimony.
If utilities and others in MISO build hybrid renewables, storage and dispatchable resources, the annual need for new resources falls to about 2 GW to 3 GW, Patton said. Some near-term needs will likely be met by delayed power plant retirements, he said.
In the last 10 years, MISO has lost about 9.5 GW of accredited capacity, according to a chart shown by FERC Chairman Mark Christie at the conference.
Even so, MISO has adequate power supplies for now — and the pace of the decline in capacity has slowed in recent years, according to Todd Ramey, MISO senior vice president of markets and digital strategy.
“The concern looking forward still is that there’s work to do, even for next year, to still get as much added as we can, to try and keep up with load growth that we think is coming at us,” Ramey said.
However, Steven Lieberman, American Municipal Power vice president of transmission and regulatory affairs, contends that current trends in the region are unsustainable. “MISO’s [interconnection] queue is backlogged, retirements are outpacing additions and load is growing,” he said.
Grid operators should procure resources with specific attributes, such as quick start ability, fuel security and ramping capability, according to Lieberman.
MISO has recently developed a capacity market design that should facilitate long-term decisions that achieve resource adequacy, according to Patton. The market’s design elements include a prompt, seasonal framework; reliability-based demand curves; and a marginal reliability-based resource accreditation that takes effect in 2028, Patton said in his testimony.
“We think we’ve arrived at what is getting close to probably the best available market design,” Ramey said.
Data centers and load growth forecasts
In a question to a panel of mainly state utility regulators, FERC Commissioner Lindsay See asked whether it would be helpful to have some level of uniformity in load forecasting data assumptions.
Load forecasting “is such a complicated hot mess,” partly driven by uncertainty around data centers, said James Huston, Indiana Utility Regulatory Commission chairman.
“Load forecasting is a part of the process to try and look out over the 20 year horizon, but that horizon past three years is almost virtually unpredictable if a hyperscaler is involved in it,” Huston said.
Almost all data centers are developed with nondisclosure agreements, so getting information on what is happening is difficult, according to Doug Scott, Illinois Commerce Commission chairman. Hyperscalers consider multiple sites for a single project, and utilities have different approaches for determining what potential data center load is “real,” he noted.
“We really don’t know what the actual load growth is going to be,” Scott said, while calling for uniformity in load assessments, including potentially allowing MISO and other grid operators to “get behind the NDA.”
Marcus Hawkins, a Public Service Commission of Wisconsin commissioner, cautioned against having a single approach to load forecasting. “I’ve been hearing about near-term resource adequacy crises in MISO since 2015,” Hawkins said. “The RTOS and NERC don’t have the lever on resource adequacy. We do at this table. And so projections and blood red [reliability] maps that we get from NERC … that [are] not accurate, are their tools.”
If NERC and grid operators are given “a load forecast tool, it will be the first lever that is grabbed,” Hawkins said. “The load forecast will go up because their job gets easier when there’s a lot more resources on the grid, and so we have to recognize the dangers of getting that uniformity.”
